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8. On July 1, 2016, Azkaban buys prison equipment for $500,000, paying $50,000 cash and signing...

8. On July 1, 2016, Azkaban buys prison equipment for $500,000, paying $50,000 cash and signing a 4 year note for $450,000 at the interest rate of 3%. The note is paid once a year on July 1. The annual installment is $112,500 plus interest. Prepare the journal entry for the purchase on July 1, 2016 and the December 31, 2016 journal entry to accrue the interest for the 6 months from July 1, 2016 – December 31, 2016. (10 points)

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